FAYETTEVILLE -- The following editorial appeared in The Fayetteville Observer on Feb. 9:
With low prices and a still-tiny tax on cigarettes, North Carolina is a major source for smuggled cigarettes that find their way to high-tax states like New York.
The illegal trade is flourishing and filled with unsavory participants - like two Lebanese citizens who were convicted in 2002 of funneling the proceeds to the radical Islamic group Hezbollah. People buying cheap, smuggled cigarettes were supporting terrorists - and other organized crime as well.
The tobacco industry and convenience-store groups are urging the General Assembly to bring back the tax stamps that this state put on cigarette packages until 1994. The stamps, they say, make it harder to sell the smuggled smokes. A legislative panel studying the issue appears to be leaning toward that solution.
But applying stamps costs money. Machines that do the stamping cost $80,000 each; wholesalers aren't eager to absorb that cost, especially in a recession. Given the profits in the underground smokes, we wouldn't be surprised to find the smugglers are also excellent stamp counterfeiters too.
In a still-faltering economy, we'd suggest that lawmakers be careful on this one. There needs to be really strong evidence that the stamps will crack the back of smuggling operations before even more costs are imposed on businesses.
